Senate Republicans Block Windfall Profits Tax on Big Oil Companies
Democrats fall eight votes short of preventing filibuster
With gasoline prices topping $4 a gallon, Senate Democrats wanted the U.S. government to throttle back on the billions of dollars in profits being taken in by the major oil companies. But with the White House threatening a veto of the bill, the Senate voted 51-43 to close debate, well shy of the 60 votes needed to avoid a filibuster.The proposed windfall profits tax would have been somewhere between 10 and 12 billion dollars for this year, and it would have been levied against the country’s five largest oil companies. The legislation would have also rescinded $17 billion in tax breaks the companies expect to enjoy over the next decade.
“The oil companies need to know that there is a limit on how much profit they can take in this economy,” said Sen. Richard Durbin of Illinois, warning that if oil prices are not reined in, “we’re going to find ourselves in a deep recession.”
- » See also: Whistleblower: World Running Out of Oil Faster Than IEA Says
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A statement issued by the White House’s Office of Management and Budget (OMB) said, “Rather than addressing the principal cause of fuel price increases — rising world petroleum demand without a similar increase in supply — (the bill would) undercut U.S. energy security and decrease U.S. energy production, thus exacerbating market tightness and increasing energy prices.”
I find it quite striking that the White House is still claiming that the principal reason for the precipitous jump in oil prices is the rise in global demand, when according to Chevron Vice President of Strategic Planning, Paul Siegele, demand is not currently on the rise. Siegele raised this very point with me less than two weeks ago at a panel discussion at Stanford. (For more on the slowing of global oil demand, this article in MarketWatch reports on the International Energy Association’s projected slowdown).
Following the bill’s defeat, Democrats said they may work on separate legislation to increase oversight of trading by the Commodity Futures Trading Commission. Many argue that one of the principal drivers of rising gas prices is actually because of futures speculation on the commodities market. Sen. Charles Schumer (D-NY) said that parts of the windfall tax bill including commission provisions could be split into separate proposals.
Looking for more political content? Red, Green, and Blue: Environmental Politics from Across the Spectrum.
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Photo: Glass Window via flickr under a Creative Commons License
You can speak your mind with a T shirt printed in Arabic that reads “Stick Your Oil up Your Ass”.
There is also commentary regarding Brazil’s wise decision to switch to cane ethanol after the Oil Embargo of 1973. They are getting fuel at $.15 a gallon and exporting their surplus. We chose to support the big oil corporations who influence our politicians.
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When the price of oil falls, does congress consider tax breaks for oil companies?
Will there really be record profits for the major oil companies that are also refiners? Refining margins contract when the price of gasoline doesn’t rise as fast as oil. Last year, as oil was rising, gasoline prices were falling. Oil companies already have to make up for lost profits.
I guess I can see what the proposed tax was supposed to do. If oil companies are making more money because of high oil and gasoline prices, the tax seems to be designed to force oil companies to lower their gasoline prices. (If this is not the reason, then the Democrats just wanted to increase the government’s share of the profits.)
Either way the oil companies would lose under the proposed tax. Either they’d have to lower gas prices and constrict margins, or do nothing and get taxed.
The cost of gas would not be near as high if the value of the dollar wasn’t dropping like bag full of bullshit.
Nobody questions the Fed and its monetary policy because it is pretty boring stuff. It is much sexier to blame windfall profits on the oil companies.
Oil is a commodity. The oil companies don’t set the price for a barrel of oil. Price is set in the global commodity markets. The oil companies have fixed costs to cover exploration, extraction, refining, and transport that they are rightfully allow to add.
Those blowhard politicians ought to take a close look at how the government’s weak dollar policy is ruining America. Instead, they just want to tax us more. What a joke! FIX THE CURRENCY YOU MORONS!!!
The oil companies have profited enough. Think of those who are not in USA, they are poor and middle class people where food are very scarce.
Good! A windfall profits tax is just going to make situations worse! How can taxing a commodity make prices go down?
Oil companies don’t have it easy as you think. Even with their profits, ExxonMobil is shutting down all their company-owned stations and are selling them off as franchises since they are no longer commercially viable!
High crude oil prices affect oil companies and the consumer. All we can do is adapt to this new change, which we should have been anticipating for the past THIRTY YEARS. Nobody has the right to complain, everyone knew this day would come so it’s time to make sacrifices!
[...] bill, the Senate voted 51-43 to close debate, well shy of the 60 votes needed to avoid a filibuster.read more | digg [...]
You greenies have to be still smoking something. How is lowering the cost of oil bad for us? How are mercury filled flourescent lights good for us? How does Algore increase his residential energy usage by going green?
Time to wake up and get off the grass.
From down here in my little world, we’ve seen this coming when everyone was buying the SUV’s and Hummers to show off. A couple of years ago, middle class moms were “bragging” about how much it took to fill up their overpriced SUV’s and getting to the schools early to pick up their kids, leaving the engine running, and talking on their cell phones while they waited for the school to let out. Heck yeah, the demand went up. Everyone wants to be a big shot and now not only are the banks and car dealers now hurting, but the average consumer is.
I like John McCain too; he seems to be a great guy, personable, likable, a kind of guy that you could invite over to a BBQ. Yeah sure, I respect him for his military service. No it doesn’t bother me that he graduate in the bottom 5% of his class from the Naval Academy, (hey I dropped out of High school) or that he crashed 4 planes,(I crashed my car twice) or even that he was shot down on his first mission over Vietnam,(hey, I’m three time loser) or even the that he started singing like a bird when captured by the NVA, without being tortured, or that he cheated on his wife, while in office, and is trying to portray himself as the candidate for family values, hey who am I to judge, I’ve mad my fair share of mistakes and then some, so who am I to judge McCain for his.
What really gets me is that some of your readers, won’t name any names, (hint:on a 2001 car trip to Florida), spoke about how Bush was going to do this, and bush was going to do that, and how the economy was going to be better. What happened? We started out with a surplus and eight years later were going to end up with the biggest deficit by a president ever recorded in history, and McCain supported Bush 95% of the time.
Our economy has tanked, our Gas Prices have skyrocketed and everything from the cost of food to diapers has gotten insanely expensive. I won’t mention how many Americans lost their jobs, or the tax breaks to companies that ship American Jobs overseas. Maybe those of you that are well off can afford the basic necessities, or have a nest egg to carry you over until the economy gets better, but many Americans, including myself cannot.
We went to war in IRAQ on a LIE, remember WMDs, 4,146 soldiers are dead 30,182 wounded for a LIE .How did Americans get duped into agreeing to spend 12 Billion a month in Iraq for a war that shouldn’t even be? So far we spent $368 billion on military operations, $45 billion more in veterans care, diplomatic services, training with that type of money we could of rebuilt the nation’s Infrastructure, invested in alternative energy and established our own Universal Healthcare.
Come on, be honest, when “W” changed his focus from looking for Bin Laden in Afghanistan to invading Iraq, you weren’t all scratching your head thinking “why in the hell are we doing that?” Intelligent and hardworking Americans such as yourselves?, didn’t have any doubt about that decision? OK, ok, I will give you the benefit of the doubt.
What about when the excuse for invading Iraq was proven to be a LIE, WMDs? How about then? Were you outraged? No. no, you just voted him back into office for another four years, with the excuse, “Well,we want him to finish what he started.” What!? Come on, wake up! If that was any other American, he would be in prison.
John McCain has been in Washington for a long time, twenty-six years and nothing’s has changed. He is out of touch with reality. He doesn’t even understand economics and even admits it himself,
“The issue of economics is not something I’ve understood as well as I should,” McCain said on December 17 in New Hampshire, http://lburl.com/idd0k
I’m astounded, How can smart, Intelligent, hardworking people want McCain for president? Don’t get me wrong, I like John McCain, even after all the crappy things he has done, even after all his flopping around on issues like a fish out of water, I like him, just not as my Next President!
I am 36, and this will be my first election that I will vote in: presidential or otherwise. It’s Time for a change in Washington.
It’s time for a president for the people, from the people, someone who has seen the same hardships that we have, made the same kind of sacrifices we made, and works hard for success, Think about that when you cast your ballot in November.
This is like having the Mafia demand protection payments from you. Then the cops show up. … and ask for there cut